ACA Update: Contracting Is Essential for Community Providers

ACA Update: Contracting Is Essential for Community Providers

March 19, 2013

TARGET Center

The Affordable Care Act (ACA) recognizes the special role of safety-net providers in delivering health care to underserved populations. Provisions exist for helping Ryan White agencies continue to serve their clients as they adopt new private insurance and Medicaid coverage options. However, putting that promise into action requires agencies to do a bit of networking and negotiation.

Various technical guides, summarized below, present suggestions for safety-net providers on how to contract with health plans through a multistep process for conducting outreach to identify health insurers (private plans and Medicaid Managed Care Organizations [MCOs]), followed by a process for establishing contracting relationships with plans. (Note: In addition to reaching out directly to health insurers, providers can focus energy on joining provider networks that, in turn, establish contracts with health insurers.)

By following these steps, agencies will be in a better position to continue delivering care to clients who transition to new health plan and Medicaid coverage, starting in 2014. Ryan White agencies need to take on this work right away. Health plans are already setting up their networks and getting them approved and ready for the opening of Marketplaces on October 1, 2013. In some states, the work is well underway.

Leverage Point: Status as an Essential Community Provider

ACA requires health plans that will offer individual and small-group coverage in Marketplaces to include in their networks Essential Community Providers (ECPs). These health plans are called Qualified Health Plans (QHPs), as they meet Marketplace regulatory requirements.

What these rules state, in general, is that health plans must offer contracting opportunities to ECPs. This is an opportunity that should not be taken lightly. An unknown but significant number of Ryan White clients are going to shift to coverage under Medicaid and individual policies that will be offered in 2014, and they may experience lapses in care or may need to change providers if their current Ryan White providers are not included in these health plan networks.

Ryan White agencies--for the most part--already have been designated as ECPs. HHS has issued rules that put ACA provisions on ECPs into place, including Marketplace rules for state Marketplaces and health insurance issuers, released in March 2012, followed more recently with rules for federally facilitated/state partnership Marketplaces, issued April 2013. State approaches to ECP status also are important as health insurance is traditionally regulated by states, and ACA provides leeway for states operating their own Marketplaces to further define ECP rules. For example, California has developed specific ECP standards for QHPs seeking to offer coverage in the state. Colorado and Minnesota require agencies to apply for ECP status and outline ECP contracting requirements for health plans.

HRSA's HIV/AIDS Bureau issued a Dear Grantee Letter on ECPs on March 27, 2013, urging Ryan White providers to reach out to health insurers to be included in their provider networks, and to leverage their positions as ECPs.

Making ECP Real: Technical Tips

Various documents--including several tailored for safety-net providers--outline ideas for establishing contractual relationships with health plans. In general, the steps are as follows:

Approach the health plans to explore contracting opportunities, making sure to inform the plans that the Ryan White agency has ECP status.

Establish contractual arrangements to participate in their insurance networks.

Ryan White agencies with well-established contracting and third-party reimbursement systems are likely well versed in carrying out the above steps and may already have many contracts in place. Agencies that currently lack this capacity--particularly smaller agencies--will have to do some legwork as ACA is built upon the private marketplace, and contracting happens in a decentralized and competitive environment. Nonetheless, Ryan White agencies might want to explore ways to work together, perhaps securing assistance and guidance from Ryan White planning bodies and Part A and Part B contracting offices.

The points below summarize insights from the following documents. They are presented as general resources but not specific recommendations for how to go about contracting with health plans. Again, providers do not need to focus solely on reaching out to health insurers. A second strategy is to join provider networks that, in turn, establish contracts with health insurers.

Working Successfully with Health Plans was prepared by the Guttmacher Institute in June 2012 on behalf of family planning agencies, which are remarkably similar to Ryan White agencies in having a large proportion of clients with no third-party payers. This document, based in part on an expert panel meeting, outlines a 3-part process to “explore challenges family planning centers face in contracting with Medicaid and private health plans--a step that is increasingly necessary for centers to remain viable as health care providers.” The 3 steps: preparation, contract negotiations, and operations under plan contracts.

Negotiating a Contract with a Health Plan, was prepared by the American Academy of Family Physicians, and it presents ideas for family physicians. Prepared in 2006, this journal article presents ideas similar to the above documents in terms of the upfront assessment Guttmacher recommends (“information is power”), identifing your leverage (the HIVMA tip to inform contract partners of the agency’s ECP status), specifics around the contract (definitions, health plan and provider obligations), and more. A summary of this report also is available.

Suggested Steps for Contracting with Health Plans

Step 1: Start with Current Contracts

Approach current health plan contract partners to determine what coverage they will be offering in the Marketplaces. Ask whether the agency’s contracts are up to date and what changes need to be put in place.

Step 3: Determine the Process for Establishing Contracts

Each plan, MCO, and provider network has its own process for contracting with providers. Websites of health plans often have downloadable provider contracting materials. Contact your state Medicaid office to determine the process for becoming an enrolled provider. Contact current Medicaid contractors (especially Medicaid MCOs), state your interest in joining their network, and ask what process to follow.

Step 4: Secure Contractual Status/Relationships

Establishing a contractual relationship is a process of assessing the contracting partner (eg, their financial viability, presence in your target area), providing information (usually a form or set of forms and related documentation, such as an agency’s accreditation), and subsequent negotiations (eg, reimbursement rates). In securing contracts, information is crucial. In addition, your Ryan White agency's role as an ECP can provide leverage, as ACA provisions require health plans to have a certain number/percentage of ECPs in their networks.

Finally, Ryan White programs are urged to share their insights, tips, and guides for contracting with health plans.